ATHENS (Reuters) - Greek Prime Minister George Papandreou's cabinet reshuffle has probably paved the way for approval of a harsh austerity package but there are doubts over whether it will be implemented.

Papandreou, his own political survival on the line, plumped for party insiders and rivals to neutralise opposition instead of tough policy cops, in a wholesale shake-up of his cabinet on Friday.

He replaced unpopular Finance Minister George Papaconstantinou, architect of the reform package, with powerful party insider Evangelos Venizelos, hitherto the defence minister.

The reshuffle should appease discontent within his Socialist Party (PASOK), making it much more likely that he will win a confidence vote on Tuesday.

That will in turn enable the approval of a 28-billion-euro austerity package on top of cuts that have driven unemployment up to 16 percent and extended a recession into its third year.

The package is essential in return for a new bailout from the European Union and International Monetary Fund.

But although the new cabinet is expected to approve headline figures agreed with the EU and IMF, they may look for wiggle room when it comes to passing laws to meet those targets.

Comments from both the prime minister and his new finance chief after the shakeup appeared to fuel that concern.

Papandreou told the new cabinet they had the resolve to push through reforms and save the Greek economy. But he said the new team would try to focus more on supporting growth -- a difficult prospect for a country trying to cut its budget deficit.

Venizelos said he would go to Brussels on Sunday to try to reach agreement on changes to the plan already approved in parliamentary committee.

"Our fiscal targets can afterwords be served by other means if these means are accepted by our partners," he told Mega TV.

"All the changes, as marginal as they may be, to the mid-term plan and the implementation law, serve social justice."

SHIFTING COST CUTS?

Papandreou has also appointed Pantelis Oikonomou, an outspoken opponent of the bailout, as deputy finance minister.

Oikonomou has said that Greece should not sell loss-making companies because no one would buy them, nor profitable ones because Greeks should not lose their dividends.

"Those who are called to implement the mid-term budget plan believe in it less than Papaconstantinou," said Stefanos Manos, a political commentator and former finance minister, reflecting cynicism about the new cabinet.

Facing widespread public anger and daily demonstrations that turned violent on Wednesday, the new ministers may seek to shift some of the cost cuts or tax hikes away from previously agreed areas.

Papaconstantinou had been praised by EU and IMF officials for his efforts to implement reforms but had already failed to meet a target for cutting the budget deficit from 15.4 percent of annual output in 2009 to 8 percent in 2010.

Venizelos is Papandreou's main party rival and close to PASOK deputies who have criticised the package as too severe.

Papandreou failed to convince his first choice, ex-European Central Bank Vice-President Lucas Papademos, an internationally respected figure who analysts say would probably have adhered strictly to the letter of the deal with the EU and IMF.

Analysts said introducing a new economic team could also pose problem in talks with lenders, particularly since little is known about Venizelos's financial expertise or whether his main priority will be impressing a domestic audience or Brussels.

"(EU) finance ministers have been talking for months and now, in a very crucial, delicate phase, they suddenly have to talk to somebody new," said Kornelius Purps, a bond analyst at UniCredit. "It doesn't make it simpler to introduce a new partner about whom little is known."

TOUGH SELLOFFS

Papandreou had previously shown signs of trying to win public support by softening his plans.

Just before the reshuffle, and facing a growing backbench rebellion, Papaconstantinou agreed to refrain from raising the tax on heating fuel and to keep the tax-free threshold on property at 200,000 euros ($283,200), rather than 100,000, as the plan originally envisioned.

Venizelos is likely to seek similar solutions.

"Some of the measures that have already been announced might not be implemented," said one Greek analyst who wished not to be named. "He can leave out of the austerity package a few social groups, or make the fiscal consolidation softer."

In a sign of deep market concern over Greece's will to repay its debt mountain, equivalent to 150 percent of the annual economic output, the cost of insuring its government debt against default hit yet another record high on Friday before falling back.

Papandreou's decision to ditch 15 senior and deputy members of his cabinet at the height of negotiations with lenders has caused consternation among EU leaders.

Papandreou's reshuffle has appeased his critics but could have opened the way for further clashes over policy now that his closest ally in pursuing EU- and IMF-mandated belt-tightening is no longer at his side.

"His position as party leader and as prime minister has been severely, possibly permanently, damaged," said Eurasia Group analyst Wolfango Piccoli.

WASHINGTON (Reuters) - The United States is on the verge of announcing a "substantial" drawdown of American troops from Afghanistan, Senate Majority Leader Harry Reid said on Friday.

"There's going to be a drawdown. I am confident that it will be one that's substantial. I certainly hope so," the leading Senate Democrat said during an interview with PBS Newshour.

U.S. Army Private First Class Danny Comley of Camdenton Missouri, assigned to Delta Company 4th Brigade combat team,2-508, 82nd parachute infantry Regiment, receives flowers from an Afghan girl during a patrol in the Arghandab valley in Kandahar province, southern Afghanistan February 24, 2010. (REUTERS/Baz Ratner/Files)

There currently are about 100,000 U.S. troops fighting in Afghanistan, up from about 34,000 when President Barack Obama, a Democrat, took office in 2009.

Meanwhile, U.S. House of Representatives Speaker John Boehner, the top Republican in Congress, continued to criticize Obama's handling of U.S. air strikes against Libyan leader Muammar Gaddafi.

"He has failed to communicate to the American people why continuing this mission is critical to our national security," Boehner said in a statement.

Boehner also complained that the White House had decided to "conceal" whether the Justice Department's Office of Legal Counsel backed Obama's legal basis for military operations against Libya.

Boehner said on Thursday that Congress could cut funding for U.S. military involvement in Libya, ratcheting up tension between lawmakers and the White House over the NATO-led air war.

Reid, in the PBS interview, defended Obama's military activities against Libya, which were undertaken without approval from the U.S. Congress.

He said the 1973 U.S. War Powers Resolution, which sets out the powers of the president and Congress on U.S. military action, "has no application" to operations under way against Libyan leader Muammar Gaddafi, noting no U.S. combat troops were committed there.

Besides, Reid added, "This thing's going to be over before you know it anyway."

Republicans in the House of Representatives have threatened to cut funding for U.S. military operations in Libya because Obama did not get lawmakers' consent.

An anti-war Democrat, Representative Dennis Kucinich, on Friday said he would try to halt U.S. funds for the "unauthorized war in Libya" with an amendment to a defense spending bill expected on the House floor next week.

On Afghanistan, Reid noted that the American public suffered "war fatigue" from combat there that has been going on for nearly 10 years.

Reid, who met this week with General David Petraeus, the U.S. commander in Afghanistan, said he thought the administration could announce the troop drawdown the week after next. But he added that he had "no inside information."

The war in Afghanistan against the Taliban insurgency is costing U.S. taxpayers more than $110 billion a year.

SANTIAGO (Reuters) - The force of a volcanic eruption in Chile that has spewed an ash cloud that caused air traffic chaos around the globe has eased slightly, emergency officials said on Friday.

Ash from a volcano in Chile's Puyehue-Cordon Caulle chain that erupted on June 4 after decades lying dormant has forced the sporadic cancellation of hundreds of flights in recent weeks, from Argentina to Australia.

Sheep covered with ash from a volcanic eruption in Chile's Puyehue-Cordon Caulle chain are seen in the Argentine resort town of Villa La Angostura June 16, 2011. (REUTERS/Osvaldo Peralta)

Experts say fine ash particles belched into the air and carried around the world by winds could potentially continue to hamper air travel for months. But a decrease in the force of the eruption raises hopes the eruption is stabilizing.

"The volcanic activity has eased, but it continues to be a moderate eruption," a spokeswoman at national emergency office ONEMI told Reuters.

The eruption sent a towering ash cloud soaring up to 20 miles (30 km) into the atmosphere, though the cloud has since shrunk to just a few kilometers in height.

The eruption has grounded flights as far away as New Zealand because of the ash, which can damage jet engines, and the chaos in South America has buffeted airlines including Chile's LAN, Brazil's TAM and Gol.

LAN briefly interrupted domestic Chilean flights south to Patagonia on Friday due to to the ash, before resuming services.

Air travel in northern Europe and Britain was hit last month after Iceland's most active volcano at Grimsvotn sent a thick plume of ash and smoke 15.5 miles (25 km) into the sky.

The Chilean eruption has also coated picture-postcard tourist towns in southern Argentina with gray ash, impacting livestock and deterring visitors during the lucrative winter season.

In April last year, the eruption of another Icelandic volcano, Eyjafjallajokull, led to 100,000 canceled flights, affecting 10 million people at a cost of $1.7 billion.

Chilean volcanoes tend to spew more ash than European volcanoes like Iceland's, because the magma is thicker and rises more slowly. As a result more ash is expelled.

It was the latest in a series of volcanic eruptions in Chile in recent years. Chile's Chaiten volcano erupted spectacularly in 2008 for the first time in thousands of years, spewing molten rock and a vast cloud of ash that reached the stratosphere.

The Llaima volcano, one of South America's most active, erupted in 2008 and 2009.

Chile's chain of about 2,000 volcanoes is the world's second-largest after Indonesia's. Some 50 to 60 are on record as having erupted, and 500 are potentially active.

LONDON (AP) — Most of the people who applied for tickets for the 2012 London Olympics missed out in the first round of sales.

Organizers announced Friday that 1.2 million of the 1.9 million people who applied for tickets ended up with nothing. Just 700,000 individuals — mostly Britons — split 3 million tickets between them after a six-week sales window.

Tickets were not put on sale on a first-come, first-served basis and events that were oversubscribed were allocated through a lottery system.

A third of the tickets have been sold to London residents, while the average successful application saw four tickets sold for 175 pounds ($283).

The 1.2 million people who missed out on tickets will be given the first opportunity to buy tickets when a further 2.3 million go on sale on June 24.

That will include 1.7 million tickets for the football matches that are being played at large stadiums across Britain on top of the 500,000 already sold. Hockey and volleyball tickets are among the other 600,000 tickets available from next Friday.

By next month organizers expect to have raised 400 million pounds ($647 million) from ticket sales, with a further 100 million pounds ($162 million) anticipated by the time the Olympics start on July 27, 2012. In total, 6.6 million tickets will have been made available to the public.

While tickets remain for sports such as track and field, others like track cycling, rhythmic gymnastics, triathlon, modern pentathlon and the cross-country equestrian competition are sold out.

The expectation of seeing Usain Bolt in the 100 meters final attracted 1.3 million applications, but only 30,000 of the 80,000 seats at the Olympic Stadium will have gone on general sale. So far 21,000 tickets have been sold and the remaining 9,000 will be made available next year.

Tickets that go on sale to the British public can be bought by anyone living the European Union.

But only 3 percent of sales through the official site have come from outside Britain. People can also buy tickets in their own country through a designated company or the national Olympic committee.

"If you benchmark that (demand) against other games it's a massive domestic interest," organizing committee chairman Sebastian Coe said. "I would be hard pushed to give you such a demand for any other sporting event in my lifetime."

SOUTHAMPTON, England (AP) — Whenever officials at the Rose Bowl get round to making a test honors board, it will be with a certain amount of poignancy that Chris Tremlett becomes the first player to have his name hoisted upon it.

Returning to the ground where he started his career with Hampshire and where his father, Tim, works as the county side's secretary, the 6ft 8in England fast bowler ripped through Sri Lanka's batting lineup on Friday to complete a five-wicket haul in the first-ever test in Southampton.

Test-best figures of 6-42 enhanced the growing reputation of a bowler who is being compared in some quarters to West Indies greats Joel Garner and Curtly Ambrose, among other legendary pacemen. It's worth remembering that Tremlett has only played in nine test matches.

"I'm extremely proud. It's been a great couple of days, not only for Chris but for the Rose Bowl," Tim Tremlett told The Associated Press.

"He was born and bred in Southampton, and brought up through the Hampshire academy. So certainly for the family and for Chris, to get six wickets in the first innings here is quite extraordinary."

Tremlett was born into a family steeped in cricketing history. His father was a seamer for Hampshire while his late grandfather Maurice, who was born and died in the county, played for Somerset and England in the 1940s and '50s.

It was therefore no surprise that Chris Tremlett began his career at Hampshire, playing 10 years for the team before a move to Surrey last year in a bid to kickstart a stalling career.

Now an established fixture in England's bowling unit since his recall to the team during the recent Ashes series in Australia, he returned to the Rose Bowl this week for the third and final test against Sri Lanka with an enhanced status. And he hasn't failed to disappoint the fans who used to cheer him as a Hampshire player.

"He's got a lot of attributes like Joel Garner, height and good bounce," England bowling coach David Saker. "It's a big call to compare him with Joel but that height and the bounce he does get, he complements James Anderson really well.

"He's been fantastic for us. He needs to keep improving but he's proven to a lot of people he belongs in test cricket."

Tremlett has taken 31 wickets in six test matches since being recalled to the England side after a 3½-year spell in the international wilderness.

In 2007, he played all three tests in a home series against India, taking 13 wickets in six matches, but his career quickly went downhill.

"It was a bit of a wrench for him to leave Hampshire last year but at the same time he'd had a couple of injuries and had perhaps gone a bit stale," Tim Tremlett said. "With one thing or another, it was the right time for a new challenge.

"He wasn't in the England set-up at the time and he said that to get back in the England side, he needed to make that move to Surrey. It's proved to be right. I'm glad he got another opportunity."

The 29-year-old has bulked out in recent years and cuts an imposing figure as he runs into bowl. Sri Lanka's batting lineup has had no answer to him in the first two days in Southampton, with the overcast and damp conditions ideal for swing bowling.

"I'm very happy with my performance and hopefully I can do it again in the second innings," said Tremlett.

With no test history at the Rose Bowl to speak of, Hampshire officials have yet to put up an honors board, which commemorates players who achieve notable feats in a match such as five- or 10-wicket hauls and centuries.

SAINT-OMER, France (AP) — Andrea Perrino of Italy and Scotsman Craig Lee shared a one-shot lead after the second round of the Saint-Omer Open on Friday.

Lee had six birdies and three bogeys for a 3-under 68 and a total of 5-under 137 as he overcame windy and wet conditions. His Italian rival carded a 2-under 69 with three birdies and one bogey.

Both men have a one-stroke lead over first-round leader George Coetzee of South Africa. Another Italian, Federico Colombo, is fourth at 3 under.

"I'm delighted with that," Lee said. "The scoring didn't progress as much as I thought, so here I am leading the tournament. I've played nicely the last two days. This course is tricky at the best of times and with the wind it is hard. It's supposed to only get worse tomorrow so it's going to be an interesting weekend. This is the third time I've played here and twice before I've missed the cut."

Benn Barham, Thomas Norret, Andrew Tampion, Marco Ruiz and Matthew Zions are tied for fifth, three strokes off the pace.

Perrino said he achieved a "dream" by leading a European Tour tournament for the first time of his career.

"I've just got to stay calm and make the best out it," he said. "I'm not going to worry about it or play with fear it's just a game."

Coetzee, who led by two shots after the first round, lost his lead with a bogey at the fourth and a double bogey at the 14th.

"I'm happy to take that score and still be in contention for the weekend," he said. "It looked like the weather was going to be okay but when we teed off it was pouring with rain, so it was tough out there. Hopefully we'll have some nicer weather tomorrow and I can get some birdies going."

THE ACE Market and companies listed on it have been making the news of late for all the wrong reasons. News flow on the weak performance of recently-listed companies on ACE, still largely perceived as a listing avenue for tech-heavy high-growth firms, has led to intense scrutiny as well as criticism of the alternative market.

However, there are many examples of companies which have used this platform to list and fared well in terms of growth and moved on to the higher league, the Main Market. Most of them are technology-based or trading/services firms. As at mid-June this year, some 23 companies have made the migration; ten are listed under the trading/services sector, nine under technology, three under industrial products and one under consumer products.

The dominance of technology-based stocks is a reflection of the ACE Market itself, where more than half the companies listed are technology-based.

JobStreet

Among the more prominent transfers is JobStreet Corp Bhd, which was listed on the old Mesdaq Market in 2004 with venture capital backing from Walden International. The company moved to the main board in December 2007.

JobStreet's chief financial officer Greg Poarch tells StarBizweek in an email reply that being a public-listed company (PLC) helped in the areas of investor relations, corporate governance, compliance and financial discipline.

"Aside from providing funding that enabled us to expand regionally, Walden also helped us to instil financial discipline, corporate governance, accountability and prepare for life ahead as a PLC," he notes.

Poarch adds that the listing was an important exit strategy for JobStreet's early investors to realise their investment and for new investors to participate in the company's further growth.

"Some Internet business models like ours when executed well can generate high margins, high returns on equity with high free cashflow," he says.

But Poarch says that Internet or tech-based businesses still need to be nurtured like any other business.

"There needs to be financial discipline and cost control (for example prudent marketing spend), performance-based remuneration structure, prudent management team, re-investment into research and development (R&D) among others," he says.

Another ACE Market migrant is Green Packet Bhd, a mobile broadband networking solutions provider listed on the Mesdaq Market in 2005, and which transferred in July 2007.

While still a loss-making company, group managing director (MD) and chief executive officer (CEO) Puan Chan Cheong noted in a recent media briefing that losses have narrowed year-on-year with the company on-track to achieve EBITDA or earnings before interest, taxes, depreciation and amortisation break-even target by year-end.

Scicom (MSC) Bhd, a contact-centre outsourcing service provider which moved to the Main Market in March last year, is another company which has done well.

The company listed on the Mesdaq Market in 2005, a record year of listings when 46 companies were brought to market, has been profitable over the past five years to 2010.

Scicom's chairman Krishnan Menon had said that the company expects revenue to come from the outsourcing, education and customer relationship management sectors in tandem with the company's growth strategy for the domestic and regional markets.

Kellington

For Kelington Group Bhd, the first company to list on the ACE Market in late 2009 and which is seeking a transfer to the Main Market, the enhanced profile from listing helped in bids for larger projects.

He adds that the listing on the ACE Market has been a learning experience in managing a PLC, which is vastly different from running a privately-owned firm.

"The new status requires a lot more discipline in the management to instill good corporate governance practices to shareholders. Anyway, this will definitely prepare us well for our potential graduation to the Main Market," Gan says.

He adds that a transfer to the Main Market will give investors the right perception of the company's track record. Kelington has for three consecutive financial years to Dec 31, 2010 achieved an aggregate audited consolidated net profit of RM23.24mil, which fulfills the RM20mil criteria for a transfer.

Besides the better market positioning, Gan says the transfer will provide the company wider access to the capital market and the financial institutions for funding purpose in the event of any mergers and acquisitions(M&A) or future business expansion plans.

He says that regulators and the investment community need to be well-informed in order to be able to distinguish a good business model from a bad one.

"The companies seeking listing on the ACE Market must be able to build a unique selling proposition or acquire competitive advantages to ensure their business viability. Besides that, the risks involved needs to be mitigated as well," Gan says.

Grand-Flo

Grand-Flo Solution Bhd group president cum MD Derrick Tan says besides the image boost, the listing enabled the company to penetrate into bigger accounts both domestically and regionally.

"The proceeds generated from our listing and the funds raised from the capital market from time to time enabled us to achieve good growth through M&A activities, consistent R&D and internal organic growth," he says.

Tan stresses that growing from a small to a larger and more sustainable set-up takes time with no short-cut to success even in the high-growth industries.

"You've to move one step at a time, put strategies in place and get them executed one by one. Along the way, we may make some mistakes, but we learn fast, do some corrections and move one step ahead," he says.

Privasia Technology Bhd, which took over the listing of loss-making Airocom Technology Bhd in May 2009, has posted net profits for the financial years ended Dec 31, 2009 (FY09) and FY10 of RM1.06mil and RM4.67mil respectively.

"The opportunity to be listed on the ACE Market of Bursa Malaysia has definitely assisted us in raising our profile among our clients, investors and stakeholders," he says.

Puvanesan says the news surrounding the recent listings on the ACE Market were more exception than the rule.

"I think the ACE Market has many good profitable companies. To write off the entire board due to a few bad apples is unfair to some really good and growing companies," he adds.

Puvanesan believes that the success of a company is not determined by the type of shareholders it has. He thinks that venture capital-backed firms may have a slight advantage.

"Privasia started off with self-funding. However it is undeniable that the venture capital-backed companies may have a slight advantage in terms of having expertise to advise them on financial aspects and industry performance," Puvanesan says.

He points out that companies, whether listed on the ACE or Main Market, will have better chances of survival if they build on their core competency, focus on forward vision and have a disciplined approach to resources management.

The alternative market has drawn harsh scrutiny due to some bad apples.

IN an efficient stock market environment, a company's share price would generally be driven by its core fundamentals such as its financial performance and outlook, business prospects and management quality. But in reality, there's really no clean-cut equation that could perfectly explain the "buy and sell" forces that ultimately determine the movement of a company's share price.

Financial markets are as much a place for investment as it is for speculation, as other factors such as sentiment and greed also come into play.

Be that as it may, the recent rout of some newly-listed shares on Bursa Malaysia's ACE Market has revived concern among certain quarters of the investing public over the quality of companies going on the board and their vulnerability to speculative activities.

XOX fell on its debut last Friday to 52 sen, representing a discount of 35% from its initial public offer (IPO) price of 80 sen. A day before listing, the mobile virtual network operator announced it made a net loss of RM1.67mil for the quarter ended March 31, 2011.

XOX continued its slide over the week, closing at 44 sen yesterday.

MClean, which came to the ACE Market last month, had also failed to impress, with its share price ending yesterday's trade at 23 sen, almost half of its IPO price of 52 sen. The Singapore-based precision cleaning service provider for hard disk drives also reported a net loss for the quarter ended March 31, 2011 of RM196,000.

"No doubt, such cases would somehow strengthen the perception of some parties that the relatively easier' requirement for listing on the ACE Market has opened the floodgates to some poor quality companies to go on board. But this perception may not necessarily be true all the time," an investment banker tells StarBizWeek.

"And to be fair, the initial quarterly financial results should not be taken as the absolute test of the quality of a company," he adds.

Volatile trade

There have been seven new listings on the ACE Market so far this year, four of which have been trading at a premium to their offer prices. XOX and MClean are among the three currently trading below their IPO price. The other is industrial labels and nameplates manufacturer Ideal Jacobs (M) Corp Bhd.

But what sets Ideal Jacobs apart is that it made a net profit of RM371,000 for the quarter to March 31, 2011, and this was announced five days before the company went on board on May 18.

On its debut, Ideal Jacob saw its share price trade at an intra-day high of RM1.10, which was 307% above its IPO price of 27 sen, before closing at 43 sen that day and ending up at 25 sen yesterday.

The perception that many ACE Market listed shares are generally more susceptible to manipulation stems from the fact that these companies have relatively smaller share base and market capitalisation.

"Prices of some of these stocks can see significant movements in intra-day trading, and for no particular reason at that ... needless to say, therefore, there is a strong perception that speculative trading among these stocks is quite prevalent at times," an analyst explains, pointing to recent movements of Tricubes Bhd and Ingenuity Solutions Bhd.

Loss-making Tricubes has seen significant activity in its share price and heavy trading volume since the announcement of the controversial 1Malaysia email project in April. The counter of Ingenuity Solutions last month also witnessed similar activity, triggering an unusual market activity query from Bursa Malaysia.

These scenarios, however, are not unique to Malaysia. ACE Market equivalents in other parts of the world, such as Singapore Stock Exchange's Catalist and Hong Kong Stock Exchange's Growth Enterprise Market, or GEM, are also subject to such volatility while many of the companies listed on these exchanges are also trading below their IPO prices. Nevertheless, these alternative markets have been widely accepted as critical components of the capital markets in their countries.

Playing its ACE

ACE Market is Malaysia's version of the alternative market. It was created in August 2009 to succeed the Mesdaq Market.

The latter, launched in October 1997, was targeted mainly at high-growth and technology-based companies for listings, while the improved ACE Market is open to companies of all sizes and from all industries.

ACE Market generally has less stringent requirements for listing compared with that of the Main Market of Bursa. For instance, there is no minimum operating track record or profit requirement and no minimum IPO price for listings on the ACE Market.

The removal of these entry barriers has made it easier for SMEs (small and medium-sized enterprises) and smallish, but fast-growing companies to tap the capital market for funds.

"SMEs are the backbone of Malaysia's economy; there's certainly a need to provide a less complicated' avenue for the industry to raise capital so that they can continue to grow," says Mayban Ventures Sdn Bhd director of private equity Andrew Ho.

According to SME Corp Malaysia, SMEs represent about 99% of total business establishments and account for 56% of total employment in the country.

The segment's contribution to Malaysia's gross domestic product (GDP) at 31% currently is still relatively low compared to that of most other industrial and developing countries, whose SMEs typically account for 40%-60% to their GDP. But this only means that there is ample room for SMEs in Malaysia to grow.

SME Corp believes that the industry would grow at 8.5% this year, superseding that of the country's official GDP growth target of 6%.

"The creation of the ACE Market hence is in line with Malaysia's economic aspiration and needs; by virtue of it being an easily accessible avenue for SMEs to raise capital for expansion, it is actually helping the country to fuel its economic growth," a market observer explains.

Caught in the middle

Still, there are some who question whether the Malaysian venture capital industry, which is a growing alternative source of financing to many start-up and small companies in the country, could have been a better source for some ACE Market-listed companies.

"Not really. A bulk of companies making their debut on the ACE Market are SMEs that have already surpassed the minimum criteria imposed by venture capitalists. Many of these companies simply do not fit into venture capitalists' profile.

"So, where can they raise funds to support their expansion if we do not provide an alternative market like ACE? They are too big for venture capitalists and too small to qualify for listing on the Main Market. Without capital injection, these SMEs cannot move into the big league'," says the investment banker.

Venture capitalists defend the need for the ACE Market for two main reasons to provide an additional option to exit their investments and an avenue for further fund-raising to support their existing investments. This in turn will encourage further venture capitalists' activities and investments in start-ups.

As Mayban Ventures Sdn Bhd's director of private equity Andrew Ho puts it, "Venture capitalists and entrepreneurs need a vibrant ACE Market and the stock market in general, as this will promote further entrepreneurial activities through better and more efficient allocation of resources."

"The existence of ACE Market is not for venture capitalists alone. It is definitely one of the options for us to exit, but not the only avenue. ACE Market in Malaysia is more for SMEs to raise funds to finance their companies' expansion," Teak Capital managing director Chok Kwee Bee says.

On venture capitalist-funded companies that have graduated to public listed status, Chok says the number is still relatively small compared with the number of companies that have done it on their own. Nevertheless, she says, "When we make our investments in those companies, we obviously do our due diligence to understand the company's prospects going forward."

It is often argued that listed companies that have been venture capitalist-funded tend to fare better as they have been subject to financial discipline and accountability. Companies that have been funded by venture capitalists include JobStreet Corp Bhd and REDtone International Bhd.

However, analysts argue that a company's success ultimately depends largely on the entrepreneurial skills of the management, and not merely on financial discipline and accountability.

"The perception that the ACE Market comprises mainly poor quality companies is not entirely justified," an investment banker argues, pointing to the encouraging number of ACE Market-listed companies migrating to the Main Market over the past few years as testament that there are many good companies on ACE.

Needless to say, there have also been some bad apples listed on ACE, but their numbers are relatively low compared to those that have done well by migrating to the Main Market. Based on Bursa Malaysia's data, so far, eight ACE companies have been de-listed due to their consistently poor financial performances and irregularities.

Cyclical nature of businesses

While the success rate of ACE companies migrating to the Main Market is encouraging, many industry observers believe it would not be sensible to introduce a time frame to pressure companies to perform and migrate to a higher level.

"Imposing a time frame within which they are required to migrate to the Main Market would put restrictions on them, and regulators could be seen as interfering in the companies' business planning," an industry observer says.

"Such restrictions will also indirectly penalise the companies by making their shares more vulnerable to potential selldown towards the maturity period if those companies still can't meet certain requirements when in fact the time given to them is insufficient in the first place.

"Some companies may take a longer gestation period; hence, they should be given enough latitute to grow at their own sustainable pace," he adds.

In reference to new listings on the ACE Market, a market observer says "investors should give a longer time frame, depending on the type of business and industry that the company is in, before determining whether the company is of good quality or not."

Growth companies at initial stages of their lifecycles which is usually the case for ACE Market listings tend to lack an impressive track record to boast about. Hence, it is unfair to use share prices as an absolute gauge of the quality of the companies.

"Share prices are not a reflection of the quality of listed companies," a market observer says.

"Investors need to recognise that there are many types of businesses that are at various stages of their lifecycles. Judge their performances based on whether these companies' businesses have grown over the years and whether their earnings have improved," he adds.

To be fair, stock markets worldwide are now in the wrong cycle. Understandably, the prevailing poor sentiment would continue to put downward pressure on many shares.

"Let's face it: we're not in the best of shape rising inflation, the euro debt crisis and continued uncertainties about the prospects of developed economies will continue to haunt stock markets worldwide," an analyst says.

Accountability of gatekeepers

Under the regulatory framework for the ACE Market, sponsors (comprising mainly investment bankers) will have to be appointed by companies seeking admission to evaluate their suitability. Essentially, these sponsors have taken the Securities Commission's (SC) role as the gatekeeper under the framework for ACE Market listings.

The main role of sponsors include conducting, actively participating in and overseeing the preparation and due diligence process for the ACE companies' public documents. Also, the sponsors must maintain regular contact with the companies, including being available at all times to advise and guide the companies. A sponsor is tied to an ACE company for at least three years after listing.

"Given the reputational risk attached, a sponsor would have to be more discerning in choosing which companies they are sponsoring," says a corporate observer, adding that the onus is on sponsors to ensure that good companies are listed on the ACE Market.

The SC and Bursa Malaysia, as regulators of the country's capital market, stand ready to take stern action against sponsors if they were found to be negligent in carrying out their duties as the main gatekeeper. Penalties could range from merely administrative action to criminal charges.

It is understood that the SC will soon introduce a "thematic-inspection" scheme, whereby the faults of sponsors will be highlighted specifically on the SC website. This method has already been deployed by the Hong Kong Stock Exchange to apply pressure on sponsors.

No hidden skeleton?

The pledge for ACE Market listings is clear to be a transparent process based on the principles of full disclosure. It is understood that SC and Bursa have been particularly hard on compelling potential listings to abide by those principles.

A former investment banker attests to that: "Disclosure-based regime is actually harder on the regulators; while sponsors are the main gatekeepers, the regulators still play their roles in ensuring that all parties involved have disclosed all the necessary information such as potential risks and other operational issues and challenges on their documents or prospectus."

It is understood that there have been cases where the SC has even called for prospectuses of several new listings to be rewritten due to "inadequate disclosure" before those prospectuses are released to the public.

"ACE Market is indeed supported by a strong regulatory framework. As we see it, there is certainly no let up in this area," an analyst says, pointing to the case of Focus Point Holdings Bhd as an example.

Listing of the optical product and service provider was halted at the eleventh hour in July last year and deferred to a later date. According to the SC then, the deferment was to allow the company to address certain allegations against it.

To recap, prior to Focus Point's original listing date, reports came out that as at the end of 2009, 38 of the company's 64 eyecare centres were found to have been dispensing contact lenses over the counter without an optometrist or an optician qualified to prescribe or dispense them. The regulators then decided to defer the company's listing to give it time to inform the market about the impact of the new finding on its business going forward.

The company subsequently announced that it had ceased the prescription and dispensing of contact lenses from outlets that did not have either an optometrist or an optician qualified to prescribe or dispense contact lenses, and got listed at the end of August last year.

Anti-dumping

There are also concerns over the "oversubscription" claims by new listings, which lends the impression that their shares are in high demand.

Investor education is necessary in such instances, an investment banker points out, as people have understand that the "oversubscription" claim actually only refers to the portion made available to the public, and in most cases, this portion could be just a small fraction of the entire issuance.

"In many of these listings, the bulk of shares being issued or offered for sale are going to parties under a private placement, whereby it isn't clear who these parties are," an analyst explains.

In the case of XOX, which reported an oversubscription of 13.2 times, only 7.5 million shares out of the 46.8 million IPO shares were made available to the public. The remainder were allotted for private placement and business associates.

MClean, which reported an oversubscription of more than 100 times, had only 2.7 million shares allotted to the public. The other tranche, involving 12.7 million shares, was offered for private placement and business associates.

Ideal Jacobs, which saw an oversubscription of 315 times of the two million shares offered to the public, had 28 million shares offered for private placement.

The analyst says that in most cases, parties under private placements of shares are not captured under the moratorium rules.

MSWG's Bushon concurs, saying: "Most of the selling was done by placement investors dumping their shares on opening day. A moratorium should be considered in such instances."

This phenomenon seemed akin to what hit some China-based companies listed on Bursa over the last one year.

GuoLine, which initially held a 15% stake in Multi-Sports, started to sell its shares in the open market 10 days after the stock's debut and ceased to be a substantial shareholder less than a month after the listing.

With Bursa having put in place strict real-time surveillance, an officer reiterates, "We cannot tolerate manipulation of shares. We place great emphasis on maintaining market integrity and ensuring investor protection."

"Nevertheless, we are also aware that we need to strike a balance, in that we cannot be too overly stringent, otherwise our action will stifle the capital market's growth."

Buyers beware

All said, spotting a company with great potential requires intensive research and due diligence. As experts argue, as long as one enters the market with one's eyes wide open and is ready to do the homework, there is always a chance that one could uncover some gems and interesting opportunities.

"Stock markets are a casino tell me which market isn't? This is particularly true for emerging growth markets, so investors should know what they are investing in," an analyst says.

In the case of ACE Market-listed companies, no profit track record implies uncertainty of the future performance of the company. Herein lies the risk to investors.

"These growth companies are early-stage companies and investors must evaluate thoroughly whether they are able to take the risk of getting into such companies," Bushon advises.

So, the decision is really in the investors' hand.

"We believe all that is necessary has already been disclosed in the companies' documents. Investors should make informed decision by studying the prospectuses.

"It's like betting on a particular company. Who knows the returns for taking the risk can be rewarding. As they say high risk, high return'," says a market observer.

THE Media Specialists Association (MSA), which is organising the 7th annual Malaysian Media Awards (MMA) this year, believes that some of the best and most innovative campaigns will come from entries competing for the "Small Budget (under RM100,000)" category.

"We have a small budget category and (the entries for this category) are often the most innovative," MSA organising committee chairman Andy Miller told StarBizWeek on the sidelines at the one-day judging session yesterday.

"(When investments are limited), it's a bit of a bonus because the ideas actually end up being more crisp, simple and good," said Miller, who is also Vizeum Malaysia chief executive officer.

A record total of 335 entries were received for this year's MMA. Following the judging process, there will be a total of around 126 finalists competing in 12 different categories, Miller said.

The final closing date for submissions was May 27.

"All of the finalists will receive certificates," Miller said.

The categories are Best Use of Television, Best Use of Newspapers, Best Use of Magazines, Best Use of Radio, Digital (online/interactive/mobile), Digital Search, Sponsorship, Out of Home Media, Point of Sale, Branded Content on TV, Small Budget (under RM100,000) excluding digital and Integrated Media Campaign.

On another note, Miller said he was "overwhelmed" by the standard of entries for this year.

"We have 40 judges looking at each of the entries to evaluate the solution, execution and results (of the campaign)."

According to Miller, entries are judged on media strategy (40%), execution of strategy (30%) and the results received for the brands involved (30%).

He also says the participating agencies are encouraged to submit videos of their work.

"We encourage them to submit videos because it helps to tell a story. Also, having a video helps us to store in our library for future reference."

The awards night will be held on July 1 at One World Hotel in Petaling Jaya with the theme "Black & White Glam".

3D is the buzz word in the movie industry and local director Bjarne Wong is the latest – and the first in Malaysia – to get in on the buzz.

The Sarawakian filmmaker, whose past works include horror (the Amber Chia-headlined Possessed) and romance (Sayang You Can Dance), is set to helm what is touted to be the country's first 3D thriller.

The Hunter 3D, slated to begin production in Sibu, Sarawak, next Monday, will capture the beauty that the Borneo rainforest has to offer.

This is not the first time Wong captures the rainforest through his lens. His early work The Legend Of The Red Curse in 2005 saw a group of final year students exploring it to shoot a documentary. What's the fascination?

"I love nature because it allows you to ponder over a lot of things. I know Borneo rainforest very well and I love it a lot, which is why I always feature it in my films.

"Malaysia and Sarawak have an abundance of natural wonders, for example, the biggest flower in the world (Rafflesia) and orang utan. Much of these have never made it to the big screen before. Why not show it to the world?" said Wong in an interview after a press conference on the movie in Shenzhen, China, in early March.

Gathering a cast that includes regular collaborators Carmen Soo and Sharifah Amani, beauty queens Cindy Chen and Soo Wincci as well as up-and-comers like Chinese actor Lou Qi and Taiwanese model Tavani Hu, the movie revolves around a film production team that journeys to the heart of the Borneo rainforest to shoot a documentary about headhunters. Mysterious things start to occur as they explore an abandoned Iban longhouse.

If you think that Wong, 39, is rehashing the premise of The Legend Of The Red Curse, he assured that's not the case.

"It won't be the same. The Legend Of The Red Curse is like my student project. We didn't have enough budget then and the technology was also not as advanced. This one will be shot in 3D. There'd be a lot of actions and violent scenes as well as special effects. Having it in 3D can help us magnify the movements and illustrate the impact of every act," he explained.

There'll be a lot of blood and gore, not to mention that there'll be sex – we heard that there is a steamy scene amidst the highly intense action.

At the centre of the sizzling act will be Hu and local actor Isaac Ong. Hu is a sexy model who was once romantically linked to Golden Melody-winning singer-songwriter Stanley Huang. She will make her acting debut here as a man magnet.

Hu, 33, expressed her excitement of filming her first bedroom scene.

"I hope it comes off as sexy instead of sleazy. It's going to be one of my sexiest performances," she promised at a recent press conference in Petaling Jaya, Selangor.

Just how far would she go when it comes to strutting her stuff on the big screen?

"I have no barrier as long as there's no nudity involved. As for how much I would bare for this movie, you would have to find out in the cinema. All I can say is that it would definitely be worth the price of the movie ticket," said the pretty actress with a coy smile.

Hot and steamy scenes aside, by jumping on the 3D bandwagon, Wong is aware of the pressure and the comparison that is bound to follow, what with The Child's Eye – the first 3D Cantonese horror film by horror maestros Danny and Oxide Pang – which generated a lot of buzz when it was released last year.

"I'm not scared of failing, but I'm scared of just staying in the same spot. I try to outdo myself in every movie. I love to keep audiences wondering about what Bjarne Wong would do next," he said.

From what we've gathered, it's not just the director that's seeking a breakthrough. The characters in the film sound like a great departure from the actresses' usual roles, too.

For one, Soo, who is seen in local films like The 3rd Generation, Visits: Hungry Ghost Anthology and more recently, in Philippine productions like A Love Affair, is playing a character unlike the glamorous model we know.

Soo said: "I play a stern and ambitious director who is so focused on her work that she doesn't think about anything else. However, as the plot thickens, she will slowly reveal different sides of herself.

"Thankfully, in my line, I've worked with many directors. I think I'm going to have fun playing the role and slowly losing the Carmen Soo side of me.

"We will be filming in the rainforest. So we are not going to be in dresses, heels and make-up. Bjarne warned us to be prepared for a lot of running, falling down as well as getting dirty. There'll be no time for vanity."

In fact, Soo first checked her vanity at the door when she was required to play a disfigured character in 2004's Visits.

"When I first started in my career, due to my modelling background, I was concerned about looking nice. As I go along I try to put that aside because it gets in the way of (portraying) your character. For the movie to work, it's whether you look right or not," she noted.

Another actress who jumps at the opportunity of breaking out of her usual roles is Sharifah who will play a Sarawakian tour guide.

"I'm very excited to play with blood, jump around, chase people and kill someone (on camera)! I've done a lot of (films which usually involved scenes of) crying and falling in love. So I can't wait to go psychotic once in a while!" she said with a laugh.

The petite beauty, who has several awards – including Best Actress at the 19th Malaysian Film Festival – under her belt, will also have to put on a convincing Sarawakian accent for her role.

As much as she wants to try something new, what is a Sharifah Amani film without romance?

"Even if there isn't any, I would try to make it happen – even if it means my character has to be with a headhunter!" she quipped.

This film sees her working on the same set again with longtime pal, Wong, as well as the crew of Possessed, Sayang You Can Dance and Hikayat Merong Mahawangsa.

"I work with Bjarne very well. It's been so many years. When he asked me to star in the movie, it was obviously a yes. Actually he didn't even have to ask. Even if it's a Chinese movie I also mou man tai (no problem in Cantonese)!" she said.

Meanwhile, snagging the role of leading man is Lou, who is best known for a string of starring roles in China-produced drama series like The Vigilantes In Masks and action epic BodyguardsAndAssassins.

"I very rarely do thriller and would love to explore the genre. It's my first time acting in a 3D production, not to mention I get to work with so many pretty girls," he said, referring to the good-looking cast consisting of models and beauty queens.

"I find Sharifah to be cute and sexy, not to mention that she's a multiple-award-winning actress. I wish to have scenes with each and every one of them," he said.

When we spoke to him in Shenzhen, the good-natured lad revealed that he had been watching many DVDs of thrillers. He also plans to take up boxing, swimming as well as photography – some of the skills his character is equipped with.

At the recent press conference in Petaling Jaya, he described his character as a man of few words.

"I have minimal lines in this film as my character believes that actions speak louder than words. So I would have to rely largely on my facial expressions to convey the emotions," he said.

The Hunteris scheduled for release in Malaysian cinemas in April next year.

Super 8's Kyle Chandler is a man comfortable in his own skin and a strong father figure both on screen and off.

THERE aren't that many adults in Super 8, but the few who are there do make their presence felt. One of them is Kyle Chandler, who plays a father with no clue on how to connect with his pre-teen son, Joe (Joel Courtney) – whose interest lies in filmmaking, building models and applying monster make-up.

Jackson Lamb (Chandler) is especially at a loss as to what to do with the boy after his wife passes away in an accident. When he tries to convince Joe to go to a baseball camp in the summer of 1979, it becomes obvious that it was his wife who had encouraged and understood their child best, and that Jackson has been mostly absent in shouldering the parenting work. Even when he has to step into the role of a single parent, Jackson chooses to spend more time fulfilling his responsibility as the town's Deputy Sheriff rather than as a father. It is only when the town is hurled into danger – with father and son caught right in the middle – that the estranged duo realises what is really important.

What the Lambs are going through is a dilemma that pops up time after time in various films. Yet, thanks to the performance from newcomer Courtney and the ever reliable Chandler, this story gets a new breath of life in Super 8.

Chandler is no stranger when it comes to playing the everyman faced with tough everyday challenges. The role of a father trying to do the best he can is something he has perfected in the TV series Friday Night Lights. Except for his role in King Kong as a pompous actor, the 45-year-old Chandler – who grew up in a farm in the small town of Loganville, Georgia – seems to have a natural instinct when it comes to playing down-to-earth characters. According to director J.J. Abrams, it was this very quality that provided the key to the character as Chandler allows that broken-hearted quality to shine through even with the character's gruff demeanour.

In person, Chandler uses words like "gosh" and "wow", which only further enforces the point that this is an actor who explicitly remembers his roots. You get an inkling of that when he paints this picture of his experience after watching Close Encounters Of The Third Kind. "I remember looking up at the night sky and thinking 'Wow, they are out there'." At another point during the interview, he says being 14 was a frustrating age for him because none of the girls wanted to dance with him.

He recalls: "In 1979, I was 14 years old, which is a tough age. You are changing, you are just slowly turning into that man. I wasn't making motion pictures, I can tell you that. These guys, wow, can you imagine?"

He is currently sitting in a suite at the Four Seasons Hotel in Singapore where he and his two young co-stars from Super 8 are talking about the film. Unlike Riley Griffiths and Ryan Lee, who are both bursting with youthful energy, chatting away without much prompting from the journalists, Chandler seems more inclined to sit comfortably on his chair and merely observe. Maybe it's jetlag. Or maybe keeping quiet is just denial when Lee shares the prank Chandler and Griffiths pulled on the flight to Singapore, in which Lee woke up with shaving cream on his face. Chandler, finally, in a dismissive tone, tells Lee: "I don't know what you're talking about."

One of the boys

Throughout the 30-minute interview, Chandler hardly adds anything to their answers and contributes only when he is ever asked a question. Even then, he somehow leads the answers back to the younger actors.

For example, when asked who his favourite character has been, he answers: "I just got done with this coach guy (Friday Night Lights). He was enjoyable. I liked the process of making that show. It was so creative. Everyone was invested in that. Everyone was expected to bring something to the table, and everyone owned a piece of that show. Just wonderful people to work with. Which wasn't a big similarity to coming to this set. J.J. is like that. It's not a matter of 'I want you do this' but 'This is what I want you to do, but what do you think?' That's really important. So everyone is involved and everyone got a piece of it, especially for these guys."

Unlike his co-stars, Chandler ventured into acting professionally when he drove down to Los Angeles when he was 23 years old. After some odd jobs, he got his first acting gig when he was 25 – that's nearly twice the age of Lee, Griffiths and Courtney, who were all 14 when they made Super 8.

"Every one of these projects is an acting class for me," says Chandler who has two Emmy nominations for his work on Friday Night Lights and Grey's Anatomy. "When you get to work with people like J.J. and Peter Jackson, you learn and get incredible experiences. It's also incredible we're doing what we're doing. I've been working for 20 years and I can't believe that I am able to raise a family and do what I do. I'm still 14 years old in this business. It's great."

On whether he'd want his two daughters to follow his footsteps, he says: "No. That's not what they're into. If that's what they are into, I will support them 100%, but that's not what they are into. My oldest daughter could not be less bored with what I do. She'll love seeing Super 8; she appreciates what I do, but she has no interest in this business. She's a really good writer, she always has a book in her hands. My other daughter, she's nine years old, and she wants to save the sharks. She did a report on how sharks are losing their fins (due to indiscriminate harvesting), that's what she's been into for two years now."

According to him, he has no problem playing the everyman. "I am fine with that. I'll just keep doing it. I like working." Although he has directed an episode of Early Edition and an episode of Friday Night Lights, he still prefers acting. "The other stuff is too much work."